A day after the FDI in multi-brand retail vote was won by the United Progressive Alliance (UPA) government in Rajya Sabha, where it faced a crucial test over the sweeping economic reforms mooted by Singh, the Prime Minister attending a golden jubilee convocation of Punjab Agricultural University here said: "Our decision to allow Foreign Direct Investment in retail, which was approved by Parliament recently, was strongly supported by farmer organisations in Punjab."

"It will introduce new technology and investment in marketing agricultural produce. India must take full advantage of modern technology and the operational and management experience of big supply chains in the food retail business to make this happen," said Singh.

"I am confident that it will benefit the farmers, and the consumers and our country," added the PM.

He said academic institutions like the Punjab Agricultural University must look to finding research solutions for dealing with new marketing challenges.

"Research can play a major role in developing varieties more suitable to different market tastes and with longer shelf life. As we move beyond staple foods, there is need for our research effort to link up more effectively with the private sector which will be responsible for market arrangements so that market demands can guide the direction of research," he said.

"The sustainability of water use in agriculture has emerged as a major problem in Punjab. Exploitation of ground water far exceeds the rate of recharge and is leading to a steady decline in the water table.

"This is clearly not sustainable. Similar problems exist in other parts of the country, but they are most severe in Punjab, where 80 percent of the development blocks are now categorised as over-exploited. By addressing this problem, Punjab will once again prove to be a leader in this area, and its lead will point the way for several other states," he said.

The PM said the challenge is how to maximise farm income while adopting a more sustainable strategy for water use.

"This definitely calls for a change in the rice-wheat cropping system, which at present covers more than 80 percent of cropped area. It is a profitable cropping cycle for the farmer only because the cost of over exploiting ground water is not part of private profitability calculations," he said.

He said Punjab cannot and should not continue over-exploiting its ground water to support rice cultivation.

"Diversification out of rice is therefore essential. Fortunately a gradual phasing out will not affect the overall food security of the country because there are good prospects of rice production in the Eastern and Central parts of our country increasing and it can be made to increase more rapidly in the future.

"The gap between potential and actual productivity at the farm level for rice is over 100% in Assam, Bihar, Chhattisgarh and Uttar Pradesh," he said.

The PM said the National Food Security Mission that his Government launched in 2007 aimed at increasing production of wheat, rice and pulses by providing better access to high quality seeds and other inputs at subsidized prices as well as creating awareness about improved production practices.

"These efforts are yielding positive results. Increasingly therefore, the burden of foodgrain production can be borne by other states," he said.

"Punjab's agricultural strategy must evolve a workable diversification plan which causes the least economic hardship to farmers and provides them with alternative crops which can yield a high enough income. There are alternative crops that can be competitive with respect to paddy.

"These include maize, cotton, sugarcane, pulses, oilseeds, fruits and vegetables. Agricultural research can play a major role in improving productivity of these crops to enhance their profitability for the farmer," he added.

He said modern biotechnology, which enables identification and implantation of genes imparting resistance and tolerance to moisture and temperature extremes, can play a very important role in future.

"Safety concerns are often raised in the context of Bt technology, and these need to be addressed in a scientifically defensible manner. However, I am confident that all legitimate health security concerns can be met and we are working to put in place an improved regulatory framework that will allow our research scientists to push ahead in their endeavour to develop technologies that can deliver positive results for farmers," he said.

"The role of agricultural research has special significance for the country as a whole and for Punjab in particular. We aim to increase our expenditure on agriculture research to 1 percent of agricultural GDP in the 12th Plan from the level of 0.65 percent in the 11th Plan," he added.

Thus far, I have spoken only about what Punjab Agricultural University can do to strengthen agriculture in Punjab. However we must recognise that even as Punjab leads in agriculture, it cannot afford to neglect the development of the non-agricultural sector, including especially manufacturing. The youth of Punjab will increasingly look for productive employment opportunities outside agriculture and it is necessary to ensure that there are enough employment opportunities for them. One way of doing this is for Punjab's agriculture to develop post farm agro-processing linkages.